Bulletin of the World Health Organization

Estimating the cost of new public health legislation

Nick Wilson, Nhung Nghiem, Rachel Foster, Linda Cobiac & Tony Blakely

Volume 90, Number 7, July 2012, 532-539

Table 3. Method used to calculate the cost of a new act or regulation, New Zealand, 1999–2010

Variable Valuea Data or method of calculation
Parliamentary input to law-making
$TP = total annual cost of running the parliamentary service, including salaries for politicians and staff, capital investment and overheads US$ 94 072 494 US$ 94.07 million for the 2009–2010 year, reported by the New Zealand Treasury19
%P = proportion of parliamentary activity attributed to law-making 26.7% Calculated using the sitting-days method (Table 1)
$P = annual cost of parliamentary activity attributed to law-making US$ 25 084 907 $P = $TP x %P
Government agency input to law-making
$TA = total annual cost of all government agencies providing policy advice to other branches of government and parliament. The full cost includes depreciation and the capital charge for the agenciesb US$ 354 929 618 US$ 354.93 million for the 2009–2010 year17
%A = proportion of policy advice related to generating new laws 16.7% See main text
$A = total annual cost of policy advice related to new laws provided by government agencies to parliament US$ 59 273 246 $A = $TA x %A
Legislative outputs
Na = average annual number of acts 18.7 See Table 2
La = average number of pages per act 73.9 See Table 2
Act output = total annual act output, pages 1381.9 Act output = Na x La
Nr = average annual number of regulations 109.5 See Table 2
Lr = average number of pages per regulation 11.1 See Table 2
Reg output = total annual regulation output, pages 1215.5 Reg output = Nr x Lr
Total output = total annual act and regulation output, pages 2597.4 Total output = act output + reg output
Pa = proportion of legislative output comprising acts (weighted by page length) 0.53 Pa = Act output/Total output
Pr = proportion of legislative output comprising regulations (weighted by page length) 0.47 Pr = Reg output/Total output
Total cost
Total cost = total annual cost of parliamentary activity and policy advice attributed to law-making US$ 84 million Total cost = $P + $A
Total cost A = total annual cost of acts US$ 45 million Total cost A = Total cost x Pa
Total cost R = total annual cost of regulations US$ 39 million Total cost R = Total cost x Pr
Average cost
Act cost = average cost of a new act US$ 2.6 million Act cost = Total cost A/Na
Reg cost = average cost of a new regulation US$ 382 000 Reg cost = Total cost R/Nr
Page cost = average cost per page of acts and regulations collectively US$ 32 434 Page cost = Total cost/Total output

US$, United States dollar.

a Monetary values were converted from New Zealand dollars to United States dollars using the 2010 exchange rate of 1 United States dollar = 1.387 New Zealand dollars.

b We used data reported by the New Zealand Ministry of Foreign Affairs and Trade to the Committee to Review Expenditure on Policy Advice.17 The cost of policy advice from agencies that deal primarily with legal issues, such as the Crown Law and the Law Commission, was also included.17